Four Corners Property Trust, Inc. (NYSE:FCPT) Q2 2020 Earnings Conference Call - Final Transcript

Jul 30, 2020 • 11:00 am ET

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Four Corners Property Trust, Inc. (NYSE:FCPT) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Thank you, sir. [Operator Instructions] Our first question today is from Nate Crossett of Berenberg. Please go ahead.

Analyst
Nate Crossett

Hey. Good morning, guys.

Executive
William Lenehan

Good morning, Nate.

Analyst
Nate Crossett

Hey. I was wondering if you could kind of just characterize the deal flow today now that you guys are acquiring again. How would you kind of size the pipeline today versus what it was pre-COVID?

Executive
William Lenehan

So, I would say, the opportunity set -- we haven't seen higher cap rates for the high-quality stuff that we tend to buy. They've been quite stable. But I would say, that it seems like deals are a little easier to come by, volume remained similar to what it was before, even though we've closed on some assets recently. So, we feel really good in that we're very well positioned relative to our peers to grow going forward.

Analyst
Nate Crossett

Okay. I wanted to get your guys thoughts on this proposal by Biden maybe eliminate the 1031 Exchange. Would that have any effect on you guys?

Executive
William Lenehan

I can see how can it be quite positive as pricing, I think, quite often is set for these smaller one-off deals by that market. But we've seen 1031 Exchange legislation proposed in the past. So, I don't want to just jump to any judgments. But, I guess, I would say, cautiously optimistic.

Analyst
Nate Crossett

Okay. And then just finally on, how much you guys have left to close on this Seritage portfolio and some of these other strategic portfolio sales that you guys have done?

Executive
William Lenehan

I don't think we've disclosed that. But you can back into the math. And essentially what I would say is, some of the properties in those portfolios we've dropped, but in most cases, we've replaced them with new properties, and in fact, in some of the cases, we think the deal sizes will increase. So, it's still very substantive.

Analyst
Nate Crossett

Okay. Just one quick last one, do you guys own any Dunkin' Donuts? Because I saw they're closing 8% of their restaurants today.

Executive
William Lenehan

I don't believe so.

Analyst
Nate Crossett

Okay. Thanks, guys.

Executive
William Lenehan

They're typically in line.

Analyst
Nate Crossett

Okay.

Operator
Operator

Our next question today is from Sheila McGrath of Evercore. Please go ahead.

Analyst
Sheila McGrath

Yes, good morning. Bill, I was wondering, if you could give us some insight on how much of the portfolio is open and operating. And do most restaurants still have capacity constraints in place?

Executive
William Lenehan

Yeah. I would say, to the best of my knowledge, virtually all of it's open and operating to some extent, and most are taking diners into the restaurant, those that are operating on curbside. What I would say is, we've seen states go from curbside to 25 to 50 to 75 to 100 and then very often back to 75 or 50 in states like Texas and Florida. But generally speaking, almost all the restaurants are open, and I think we'll just see it be a fluid situation as time goes on. I would also say that I think a lot of our casual dining restaurants are seeing continued elevated to-go